A large number of studies have focused on how individual organisms respond to a stress condition, but little attention has been paid to the stress recovery process, such as the endoplasmic reticulum (ER) stress recovery. Homocysteine-induced ER protein (HERP) was originally identified as a chaperone-like protein that is strongly induced upon ER stress. Here we show that, after ER stress induction, HERP is rapidly degraded by Ube2g2–gp78-mediated ubiquitylation and proteasomal degradation. The polyubiquitylation of HERP in vitro depends on a physical interaction between the CUE domain of gp78 and the ubiquitin-like (UBL) domain of HERP, which is essential for HERP degradation in vivo during ER stress recovery. We further show that although HERP promotes cell survival under ER stress, high levels of HERP expression reduce cell viability under oxidative stress conditions, suggesting that HERP plays a dual role in cellular stress adaptation. Together, these results establish the ubiquitin–proteasome-mediated degradation of HERP as a novel mechanism that fine-tunes the stress tolerance capacity of the cell.